Published by Newsweek | December 6, 2021
The Biden administration is asking for greater reporting requirements on all-cash real estate transactions as it tries to crack down on money laundering in real estate.
The Treasury Department announced Monday they want new regulation requirements for all-cash real estate deals to crack down on money laundering in the housing market.
The Associated Press reported the United States real estate market has been used by individuals and shell corporations as a way to launder dirty money.
As of now, only 12 cities in the United States require title insurance companies to disclose the identity of people who use shell companies to buy residential real estate valuing $300,000 or more.
The Treasury Department asked for the public’s input on a new real estate market regulation that would address weak spots in the current market.
“Increasing transparency in the real estate sector will curb the ability of corrupt officials and criminals to launder the proceeds of their ill-gotten gains through the U.S. real estate market.”
–Himamauli Das, acting director of the Treasury Financial Crimes Enforcement Network
Das added being more transparent in purchases from the real estate market could “strengthen U.S. national security and help protect the integrity of the U.S. financial system.”
The Pandora Papers, which according to Investopedia, were a release of more than 12 million leaked documents that reveal the hidden and sometimes unethical or corrupt dealings of the global wealthy and elite, revealed how corrupt government officials and world leaders have been tied to using shell companies to purchase real estate in the United States and around the world.
The U.S. real estate market has long been viewed as a stable way station for to launder proceeds from criminal activity.
The use of shell companies by current and former world leaders, and those close to them, to purchase real estate and other assets in the U.S. and elsewhere was recently spotlighted by the International Consortium of Investigative Journalists’ publication of the Pandora Papers.
The leaked documents acquired by the consortium showed King Abdullah II of Jordan, former U.K. prime minister Tony Blair and other prominent figures used shell companies to purchase mansions, exclusive beachfront property, yachts and other assets for the past quarter century.
The tax dodges can be legal but have spawned various proposals to enhance tax transparency and reinforce the fight against tax evasion.
The effort to push for new real estate market regulation comes as the Biden administration on Monday issued its “U.S. Strategy on Countering Corruption.”
